UK Issues 4 General Licenses Pertaining to Russian Oil Price Cap
The U.K. recently released four general licenses pertaining to its recent price cap on Russian oil. The first license, "Oil Price Cap: Exempt Projects and Countries," permits the supply Russian oil in certain scenarios. One such instance is the supply of Russian oil from the Sakhalin-2 Project from a place in Russia to a place in Japan, which is permitted through Sept. 29.
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The license also allows the execution of contracts that were concluded before June 4 for the import, purchase or transfer of Russian oil into Bulgaria; the purchase, import or transfer of vacuum gas oil into Croatia where no alternative supplies are available; and the supply or delivery of crude oil from Russia by ship for "a landlocked European member state" if the supply of crude oil by pipeline from Russia is interrupted "for reasons outside the control of that member state."
The "Oil Price Cap" license allows (1) the supply or delivery of Russian oil via ship from Russia to a third country or between third countries provided that the oil is bought at or below the price cap, (2) the provision of relevant services for the first permitted activity given that the price cap is still observed, and (3) payment system operators or clearing houses to process payments for these activities.
Another license, "Correspondent banking and payment processing," permits recognized payment system operators or clearing houses to process, clear or send payments from any individual or entity in connection with activities that would otherwise violate certain Russian sanctions. The license runs indefinitely.
The "Winddown" license permits (1) an individual or entity supply or deliver Russian oil by ship from Russia to a third country or between third countries, (2) a company to provide relevant services to a party supplying Russian oil by ship from Russia to a third country or between third countries, and (3) a registered clearing house or payment system operator process payments in relation to the two previously listed activities. The license allows these activities for Russian oil and oil products were loaded before 12:01 a.m. EST Dec. 5 and will be unloaded before 12:01 a.m. EST Jan. 19. The license lays out a host of conditions for these services.